An ageing population is nothing to fear
The elderly have become a scapegoat for the failures of the elites.
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People are living longer lives than ever before. In Britain at the end of the 19th century, men and women died on average in their mid to late 40s. But thanks to the social and economic development of the past 150 years, the majority of people today live beyond 80.
This ought to be regarded as something to celebrate. A testament to the tremendous advances Britain has made since the Industrial Revolution. A tribute to myriad improvements in sanitation, diet and medical knowledge. Yet for far too many politicians, commentators and academics, the fact we’re living longer than ever is seen as a serious problem – even as a source of despair. Last week, two reports, one on the malfunctioning National Health Service (NHS) and another on the steadily rising public debt, attributed much of the blame for Britain’s woes to our population’s longevity.
Lord Darzi’s government-commissioned report on the state of the NHS claimed that the UK’s ‘ageing population is the most significant driver of increased healthcare needs’. Elsewhere, the Office for Budget Responsibility (OBR), the statutory watchdog on public spending, published its annual ‘fiscal risks and sustainability’ report. The OBR stated that Britain’s public debt was on an ‘unsustainable’ upward path partly because of the ageing population.
These claims about the damaging impact of demographic change turn the idea of progress on its head. Data showing that the NHS spends more on the elderly than on the young is hardly a cause for despair. Rather, all it means is that relatively fewer non-elderly people are falling ill or, worse, dying before they reach old age.
It is a well-established fact that health spending is much higher close to the end of life. In Britain, almost one-third of hospital spending is on people in the last three years of their life, at whatever age that befalls people. Thus, as people live longer – and die at older ages – these end-of-life costs will be postponed under older ages.
Therefore the share of health spending on the pre-elderly – that is, those under 70 – is declining precisely because of improved life expectancy. It is only because more and more people are living longer that the share of health spending on the elderly is rising. Yet this wholly positive achievement is now being interpreted as a negative cost for society.
Today’s doomsters will counter that modern health systems are struggling because elderly people may be living longer, but they’re doing so in poor health. But even this is a misleading presumption. Since 2000, both Britons’ life expectancy and what’s called their ‘healthy life expectancy’ from the age of 60 have improved by the same number of years. Additional longevity does not, on average, result in a greater number of elderly years in sickness or put extra strains on health budgets.
The OBR’s presentation of the rising fiscal burden of ageing is even more misleading. In its latest long-term fiscal analysis, it projects that total public spending will rise considerably over the next 50 years – from 44.5 per cent of GDP today to just over 60 per cent in 2074. Of that roughly 15 percentage-point rise, about half is due to the expected rise in interest costs of the rising public debt. The other seven or so percentage points are due to the expected rise in actual public spending on services and welfare, etc.
The OBR says the ‘main drivers of the increase in non-interest spending are ageing effects on state pensions and pensioner benefits, and the pressures on health spending from an ageing population’. Indeed, it holds ‘age-related spending’ responsible for fully two-thirds of the projected increase in non-interest public spending by 2074. The report commentary emphasises that a ‘key source of upward pressure on health spending comes from the projected further increase in life expectancy and overall ageing of the population in the UK over the coming 50 years’.
But if we dig a little deeper, we find that the OBR’s notion of ‘age-related’ spending is misleading. It refers to all spending on health, adult social care, education, state pensions and pensioner benefits, other welfare benefits and public-service pensions.
But only the spending on pensions and other pensioner benefits are surely specific to older people. These account for less than 30 per cent of so-called age-related spending today, and are forecast to make up a similar share of the projected increase in spending between now and 2074. Other categories are not old-age specific and do not reflect changes in the number of elderly people.
For instance, by far the biggest contributor to the OBR’s ‘age-related’ spending is health spending. But the growth in health spending in recent times has had little to do with the rising number and proportion of over-64s. As a share of GDP, health spending increased from 3.4 per cent of GDP in 1971 to 7.2 per cent in 2019 (pre-pandemic). That growth of 115 per cent was nearly three times greater than the increasing proportion of the population that was over 64 during the same timespan.
In fact, the OBR’s latest projections for the next half-century actually reveal the limited impact of ageing itself on public spending. Out of the projected 3.1 per cent increase per annum in health spending, demographic pressures account for only a fifth of that – which amounts to an increase on average of 0.6 per cent per annum.
The focus on demographic ageing in these two reports is not only misleading – it also does profound damage to our politics. Both Lord Darzi and the OBR are reinforcing the fatalistic sense that our problems are worsened by demographic factors that are largely outside our control.
After all, it is likely that Britain’s population, like those of other developed nations, will continue to age, a trend amplified by low fertility rates. Fewer babies being born further boosts the average age of any population. When ageing is presented as the leading cause of our social and economic problems, this undermines our ability to actually understand and overcome these challenges.
The NHS is certainly in crisis. Yet rather than blame people for getting ill or older, the aim should be to have a well-organised and well-funded health service. That also means we need to grow the UK’s wealth to enable extra public spending where it is genuinely needed. Likewise, the principal source of rising public-sector indebtedness is not people living longer, but the long-running decay in productivity growth.
We need to challenge this elite characterisation of people living longer as a problem. It is neither an obstacle to growth nor an unbearable strain on the public purse. This fatalism is wrong on every level.
Phil Mullan’s Beyond Confrontation: Globalists, Nationalists and Their Discontents is published by Emerald Publishing. Order it from Amazon (UK).
Picture by: Getty.
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